Sealift Maritime, Inc.

National Labor Relations Board - Board Decisions

Dec 16, 1982

265 N.L.R.B. 1219 (N.L.R.B. 1982)

SEALIFT MARITIME, INC.
Sealift Maritime, Inc. and Inlandboatmen's Union of
the Pacific, Marine Division, International
Longshoremen's and Warehousemen's Union,
Petitioner. Case 21-RC-17027
December 16, 1982
DECISION AND ORDER
BY CHAIRMAN VAN DE WATER AND MEMBER
JENKINS AND HUNTER
Upon a petition duly filed under Section 9(c) of
the National Labor Relations Act, as amended, a
hearing was held before Hearing Officer Jack L.
Schlumberger on July 15, 1982. After the hearing
and pursuant to Section 102.67 of the National
Labor Relations Board Rules and Regulations,
Series 8, as amended, the Regional Director for
Region 21 transferred the case to the Board for de-
cision. Thereafter, the Petitioner and the Interve-
nor' filed briefs.
Pursuant to the provisions of Section 3(b) of the
National Labor Relations Act, as amended, the Na-
tional Labor Relations Board has delegated its au-
thority in this proceeding to a three-member panel.
The Board has reviewed the rulings of the Hear-
ing Officer made at the hearing and finds that they
are free from prejudicial error. They are hereby af-
firmed.
Upon the entire record in this proceeding, the
Board finds:
1. Sealift Maritime, Inc., the Employer, is a Cali-
fornia corporation engaged in the business of trans-
porting bunker fuel in the Los Angeles harbor.
During the fiscal year immediately preceding the
hearing, it performed services valued in excess of
$50,000 for customers located within the State of
California, which customers purchased and re-
ceived goods valued in excess of $50,000, directly
from suppliers located outside the State of Califor-
nia.
2. The parties stipulated, and we find, that In-
landboatmen's Union of the Pacific, Marine Divi-
sion, International Longshoremen's and Warehou-
semen's Union, the Petitioner, has been at all times
material herein a labor organization within the
meaning of Section 2(5) of the Act. However, the
Petitioner contends that the Intervenor, Interna-
tional Organization of Masters, Mates and Pilots,
Pacific Maritime Region, AFL-CIO, is not a labor
organization within the meaning of Section 2(5) of
the Act, as amended. However, the record testimo-
ny shows that the Intervenor is an organization in
which employees may participate and join, and
which exists for the purpose of bargaining on
' International Organization of Masters, Mates and Pilots, Pacific Mari-
time Region, AFL-CIO, filed as the Intervenor.
265 NLRB No. 154
behalf of the employees with employers over
wages, hours, and other terms and conditions of
employment. We therefore find that it is a labor or-
ganization within the meaning of Section 2(5) of
the Act. Although supervisors are also admitted to
membership in the Petitioner, this does not alter
the Petitioner's status as a labor organization.s
Graham Transportation Company, 124 NLRB 960
(1959).
3. No question affecting commerce exists con-
cerning the representation of certain employees of
the Employer within the meaning of Section
9(c)(1) and Section 2(6) and (7) of the Act.
The Petitioner seeks to represent a unit of all
employees of the Employer working on boats and
oil barges but excluding office clerical employees,
guards, and supervisors as defined in the Act. The
Intervenor takes the position that the employees of
the Employer are in a unit now covered by a col-
lective-bargaining agreement between it and the
Employer, effective from May 1, 1982, through
April 30, 1985, and therefore the petition filed June
4, 1982, should be dismissed. The Employer is in
agreement with the Intervenor.
The bargaining relationship between the Em-
ployer and the Intervenor dates back to February
1, 1980, when, pursuant to a compliance agree-
ment, they became parties to a collective-bargain-
ing agreement extending through May 31, 1982.
During the term of this agreement, the Employer
became insolvent and thereafter filed for reorgani-
zation under chapter 11 of the Bankruptcy Reform
Act of 1978, with the company assuming the role
of "debtor-in-possession." See 11 U.S.C. Sections
1106, 1107(a), and 1108.3 Shortly after filing for re-
organization and becoming a debtor-in-possession,
the Employer assumed the preexisting collective-
bargaining agreement, with the bankruptcy court's
approval. Thereafter, on May 26, 1982, the parties
executed a new agreement which modified the pre-
vious contract, effective May 1, 1982, through
April 30, 1985. 4 The Employer's authorization for
entering into the new agreement is found in 11
U.S.C. Section 1108, which states that, unless the
The Petitioner contends that the Intervenor should be disqualified
from representing the employees herein because there exists a clear and
present danger of a conflict of interest between the Intervenor and the
employees, citing Siern Vista Hopital Inc, 241 NLRB 631 (1979). How-
ever, as the Petitioner has presented no substantial evidence which sup-
ports this allegation, we find it to be lacking in merit.
a As debtor-in-possession the company, subject to such limitations or
conditions as the court may prescribe, has all the rights of a trustee under
chapter I1, including the right to operate the debtor's business under sec.
1108.
4 The contract provides, inter alia, for an increase in wages over a 3-
year period for masters, chief mates, mates, deckhands, and tank officers;
for an increase in subsistence pay for other employees; for an increase in
reimbursement for employees when a vessel is based at a temporary ter-
minal; and for two more paid holidays.
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DECISIONS OF NATIONAL LABOR RELATIONS BOARD
court orders otherwise, the trustee may operate the
debtor's business, and 11 U.S.C. Section 1107(a)
which states that the debtor-in-possession has the
powers of the trustee unless limited by the court.
Therefore, by virtue of these two sections the Em-
ployer had the right and the duty to continue oper-
ation of the company without seeking the court's
approval of each business decision. The collective-
bargaining contract, which was a slightly modified
version of a contract already sanctioned by court,
was entered into in the ordinary course of business
under 11 U.S.C. Section 1108.
On June 4, 1982, the Petitioner filed the instant
petition. The Petitioner contends that the May
1982 collective-bargaining agreement between the
Employer and the Intervenor is not a bar to its pe-
tition because the contract became effective after
the Employer filed for bankruptcy, and it has nei-
ther been expressly approved nor rejected by a
Federal bankruptcy judge.
However, we agree with the position of the Em-
ployer and the Intervenor that, because the Em-
ployer had achieved the status of debtor-in-posses-
sion by the time the contract was signed, it had the
authority to continue its operations in the ordinary
course of business and thus was not obligated to
seek the approval of the bankruptcy court, as set
forth above.
We find the facts here to be similar to those in
Marcalus Manufacturing Co., Inc., 86 NLRB 315
(1949). In that case, the employer entered into a
collective-bargaining agreement 9 months prior to
filing for bankruptcy under the Bankruptcy Act of
1898, which was then in effect. At the time of the
filing, the labor contract had approximately 15
more months until its expiration date. During the
15-month period, another union filed a representa-
tion petition, claiming that the current contract was
no bar because it had not been affirmed by the
bankruptcy trustee who, under the 1898 Act, had
the duty to operate the employer's business during
reorganization. The record showed that, while the
trustee had not affirmed the contract, he had ex-
pressly refused to disavow it, and had in fact com-
plied with its terms "to the extent that he has
found it legally possible to do so within the limita-
tions of the reorganization procedure." Id. at 316.
Therefore, the Board found that a contract existed
which was sufficient to bar the representation peti-
tion.
The situation in the instant case differs in that
under the Bankruptcy Reform Act of 1978 it is not
the trustee, but the employer, as debtor-in-posses-
sion, who controls the business. 11 U.S.C. Section
1107(a) gives the debtor-in-possession all the
powers of the trustee. Thus, since in Marcalus the
trustee's mere refusal to disavow the contract was
sufficient to bar a rival petition, the execution of a
new collective-bargaining agreement by the Em-
ployer as debtor-in-possession similarly will bar a
petition unless and until the contract is rejected by
the bankruptcy court.
For these reasons, we find that the collective-
bargaining agreement between the Employer and
the Intervenor is an effective bar to the representa-
tion petition, and therefore we shall dismiss the pe-
tition.
ORDER
It is hereby ordered that the petition be, and it
hereby is, dismissed.
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